Development Law 4887/2022

The 1st Proclamation of the Aid Scheme “Processing – Supply Chain Logistics ” of the Development Law 4887/2022 was issued with the submissions of applications of investment projects starting on July 27 th , 2022 and the closing date of the submission cycle on October 31 st , 2022.

The Development Law defines the eligibility conditions as well as the framework for setting up regimes for the granting of state aid. This framework, together with the Regional Aids Charter, provides aid rates for businesses that reach up to 75%.

Aid schemes that are expected within the next few days to be announced are:

  • Agri-food – Primary Production and Processing of Agricultural Products – Fisheries.
  • Enhancement of Tourism Investments.

Aid Schemes :

The object of the new Development Law is the establishment of state aid schemes for investment projects which can fall under the following categories:

1
DIGITAL AND TECHNOLOGICAL BUSINESS TRANSFORMATION
Immediate evaluation
2
GREEN TRANSITION - ENVIRONMENTAL BUSINESS UPGRADE
Immediate evaluation
3
NEW ENTREPRENEURSHIP
Comparative evaluation
4
FAIR DEVELOPMENT TRANSITION
Immediate evaluation
5
RESEARCH AND APPLIED INNOVATION
Immediate evaluation
6
AGRI-FOOD - PRIMARY PRODUCTION AND PROCESSING OF AGRICULTURAL PRODUCTS - FISHERIES
Comparative evaluation
7
PROCESSING - SUPPLY CHAIN LOGISTICS
Comparative evaluation
8
BUSINESS EXTROVERSION
Comparative evaluation
9
ENHANCEMENT OF TOURISM INVESTMENTS
Comparative evaluation
10
ALTERNATIVES FORMS OF TOURISM
Comparative evaluation
11
MAJOR INVESTMENTS
Immediate evaluation
12
EUROPEAN VALUE CHAINS
Immediate evaluation
12
ENTREPRENEURSHIP 360
Comparative evaluation

BENEFICIARIES OF AID

The statutory aid regime includes companies that are established or have a branch in the Hellenic Territory at the time of the investment project’s commencement and have one of the following forms:

  • Commercial Company.Cooperative
  • Social Cooperative Companies, Agricultural Cooperatives (AC), Producer Groups (PG) and
    Agricultural Corporate Partnerships (ACP)
  • Companies under establishment or under merging, with the obligation to complete all the necessary
    procedures of the establishment or the merging before the investment project’s commencement
  • Joint Ventures,
  • Public and municipal companies, and their subsidiaries (under conditions).
  • Individual companies with maximum eligible cost of investment plan of 200,000 € and only for the aid
    scheme “Agri-food – primary production and processing of agricultural products – fisheries”.

TYPES OF AID

The types of aid are as follows:

  • Subsidy, which consists of the free provision of a sum of money by the State to cover part of the aided
    costs of the investment project and is determined as a percentage of them. The subsidy can be granted gradually, after implementing the25%, the 50% or the 65% and the 100% of the total cost of the investment project.
  • Tax exemption, which regards the exemption from the payment of income tax on the profits realized before tax, which arise under the tax legislation, from all the activities of the business, minus the tax of the legal entity corresponding to the profits distributed or assumed by the partners.
  • Leasing subsidy, which consists of the coverage by the State of part of the leasing instalments paid, which is concluded for the acquisition of new mechanical and other equipment. The leasing subsidy cannot exceed the period of 7 years it begins from the date of the investment project’s completion.
  • Subsidization of the created employment’s cost, which consists of the coverage by the State part of the wage costs of the new jobs created and linked to the investment project and cannot receive any other state aid.
  • Risk finance for the investment projects that will be subject to the scheme "Neo Entrepreneurship". It is noted that the purpose of this new scheme is to support young entrepreneurs active in specific sectors of the economy and cover the costs of the companies set up, research activities, as well as the costs of implementing initial investments.

MINIMUM COST OF INVESTMENT PROJECTS

The approval of the investment projects according to the Development Law, requires the existence of a
minimum amount of the investment project cost, which is determined based on the size of the investor, and
amounts to:

  1. One million (1.000.000€) euros for large companies
  2. Five hundred thousand (500.000€) euros for medium-sized companies
  3. Two hundred and fifty thousand (250.000€) euros for small-sized companies
  4. One hundred thousand (100.000€) euros for micro- sized companies
  5. Fifty thousand (50.000€) euros for the Social Cooperative Enterprises, Agricultural Cooperatives,
    Urban Cooperatives, Producer Groups and Agricultural Parentships.

ELIGIBLE COSTS

Eligible Costs Within Regional Aid

  • Eligible costs of tangible assets:
    1. Construction, expansion, modernization of building facilities.
    2. Purchase of all or part of the existing fixed assets (buildings, machinery and other equipment) of
      a business facility that has been closed.
    3. The purchase and installation of new modern machinery and other equipment.
    4. The leases of new modern machinery and other equipment.
    5. The costs of modernizing special installations (not relating to buildings) and mechanical installations.
  • Eligible costs of intangible assets:
    1. Transfer of technology through the purchase of intellectual property rights, licences, patents, know-how and unpatented technical knowledge.
    2. Quality assurance and control systems, certifications, supply and installation of software and systems of organization of the enterprise.
  • Wage costs of new jobs created over a period of 2 years.

Eligible Costs not included in the Regional Aid

  • Investment expenses for consulting services to small and medium-sized enterprises.
  • Start-up costs for start-ups and small and micro-enterprises under establishment.
  • Expenditure on research and development projects.
  • Innovation costs for small and medium-sized enterprises.
  • Costs for procedural and organizational innovation for small and medium-sized and large enterprises.
  • Investment expenditure for the protection of the environment.
  • Investment costs for energy efficiency measures.
  • Investment costs for the cogeneration of high-efficiency energy from Renewable Energy Sources.
  • Expenditure on energy production from renewable sources.
  • Costs for the installation of efficient district heating and cooling systems.
  • Costs for the rehabilitation of contaminated sites.
  • Costs for recycling and reuse of waste.
  • Expenditure on vocational training.
  • Aid for the participation of small and medium-sized enterprises in trade fairs.
  • Aid for disadvantaged workers.

REGIONAL AID INTENSITIES

According to the Regional Aid Map of Greece for the period of 01/01/2022 to 31/12/2027, the maximum aid
rates per region are the following:

AREAS OF ACTIVITY FOR THE SUBMITTED INVESTMENT PROJECTS

The aid schemes of the Development Law include investment projects in all sectors of the Economy, with
specific exceptions.

FINANCING OF THE INVESTMENT

The investing entity can participate in the cost of the investment project either by using its equity capital or
external financing.

  1. Coverage of the investment project’s total cost or part of it using the investing entity’s equity capital:
    • Increase of the investing entity’s share capital through new cash contributions of the partners.
    • Increase of the investing entity’s share capital through capitalization of reserves.
    • Consumption of existing reserves, which in this case are frozen in a special account and cannot be
      distributed before the period of seven years in the case of large enterprises, or five years in the case of
      medium-sized enterprises, or three years in the case of small or micro enterprises, from the date of the
      investment project’s completion and the beginning of the productive operation of the investment.
    • Divestment of the company’s assets (relating exclusively land, buildings and mechanical equipment),
      with proof of the possibility of selling.

       

  2. of the investment project’s total cost or part of it using external financing:
    • Bank loan or loan from other financial institutions or a bond loan issued by public or non-public subscription, of at least three years duration, excluding the form of an overdraft account.
      According to the explicit provision of the loan agreement, the above loan is granted exclusively for the implementation of the investment project. (Indicative supporting documents: Intention or approval of a loan by a Bank or other financial institution, letter of the investing entity’s legal representative for the intention to obtain a loan).

PARTICIPATION FEE

  • For the submission of the investment projects, a fee set at 0,001 (one per thousand) of the eligible
    cost of the investment project is required. In any case, the above amount cannot be less than three
    hundred (300) euros.
  • For the evaluation of the investment projects, a fee set at 0,001 (one per thousand) of the eligible cost
    of the investment project is required. The above amount cannot be less than three hundred (300)
    euros.

EVALUATION BODIES AND PROCEDURE

The evaluation shall be carried out:

  • by a member of the Register of Certified Auditors or
  • by the Evaluation Committee or
  • by a member of the National Register of Certified Evaluators or
  • it can be assigned by the issuance of a relevant ministerial decision to the Intermediate Body of the
    Operational Programme & COMPETITIVENESS AND ENTREPRENEURSHIP & or
  • Financial institutions.

The evaluation of the investment projects starts from the date of the submission of the application and is
completed with the result of the evaluation by the Evaluation Committee, within a deadline of:

  1. forty-five (45) days from the end of the scheme for the cases of comparative evaluation,
  2. thirty (30) days for cases of direct evaluation.

STAGES OF IMPLEMENTATION / DISTRIBUTION

  • 25% Implementation and request for disbursement of the amount corresponding to this percentage.
  • 50% or 65% Implementation (intermediate evaluation)
  • 100% Completion and beginning of production process.

The implementation of the investment project can be completed within 36 months from the publication of
the investment’s project approval decision, with the possibility of extending the completion for 24
additional months.

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